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• In May 2009 the firm completed a park and recreation pool audit finding the city’s swimming pool revenue collection process was outdated and contained material control weaknesses that put the department at risk for theft and misappropriation.

• In July 2009 the firm completed an audit on the San Diego Convention Center Corp. and made 11 recommendations improving the convention center’s governance and compliance with the non-profit standards of excellence.

• In June 2007 Mayer Hoffman McCann completed its review of six city recreation centers, specifically pertaining to the issuance of city permits, cash handling, and accounting controls. The audit prompted Mayor Jerry Sanders to announce improved cash-handling practices.

• In August 2006, the firm reviewed the city’s water and wastewater pracitces which led Sanders to to announce the city would return more than $1 million to the water and wastewater deparments and implement tighter accounting controls.

The auditing firm criticized last week by State Controller John Chiang for being a “rubber stamp” while Bell city officials plundered public money is also working with several San Diego County cities, including San Diego, National City, Santee and San Marcos.

Chiang’s report was in response to the financial scandal in Bell, in which eight leaders of one of Los Angeles County’s poorest cities have been charged with misappropriating $5.5 million using fraudulent pay, unapproved loans and other strategies. The officials deny the allegations.

Irvine-based Mayer Hoffman McCann, P.C., had been auditing Bell since 2006, when it bought out the previous firm in charge of inspecting the city’s books.

The company declined to identify its local clients for The Watchdog, but a review of public records revealed that National City, San Marcos and Santee have current audits underway with the firm and Escondido, El Cajon, San Diego and Solana Beach have used them recently.

The state controller’s report found that the auditor failed to fully comply with 13 of 17 auditing standards and also:

• Failed to note that Chief Administrative Officer Robert Rizzo was amassing $800,000 in salary by charging it to five city funds.

• Did not catch a $300,000 loan to a local business owner, now in default, which was issued without City Council approval.

• Failed to scrutinize additions to city assets, including a $4.8 million land purchase from a former mayor.

The company defended its professionalism and objected to Chiang’s report, issuing a statement that said the auditors were “subjected to a massive scheme of collusion that reached through every layer of city government to undermine the audit process and deceive the auditors.”

Still, at least one city is dropping the firm in response to the report. Riverside has decided not to renew the auditors’ contract.

“It’s difficult to understand how one of the largest auditing firms in the state and maybe the country can make the kind of mistakes you found in Bell,” Riverside Mayor Ron Loveridge said. “I don’t understand it personally.”

The East County city of Santee is about one month away from receiving its latest financial audit from Mayer Hoffman. Mayor Randy Voepel said he does not want to be associated with a firm whose reputation is being called into question.

“At the end of this audit, I intend to talk to the council and city manager and ask that we go out to bid on an new auditor,” Voepel said. “I don’t want to be painted with a bad brush.”

In San Diego, city officials used the firm from 2003 to 2009 to audit special programs, said Alex Roth a spokesman for Mayor Jerry Sanders. He could not say how much they were paid.

“Mayer Hoffman McCann is not the city’s auditor, though we have used them on occasion to handle some departmental financial reviews,” Roth said in a statement. “While they aren’t currently performing any work for the city, we won’t exclude them from bidding on these types of smaller contracts in the future.”

When asked why the city won’t discontinue business with the firm, Roth replied, “The statement speaks for itself.”

Councilman Kevin Faulconer, who heads the city’s Audit Committee, said in a statement that he plans to call for a review of Mayer Hoffman McCann’s work.

“In light of the state controller’s report, I think it’s wise to ask our independent city auditor and CFO for a report on the scope and quality of work provided by Mayer Hoffman McCann,” Faulconer said. “I will docket a briefing at our next meeting on Jan. 10.”

In the South Bay, National City has been using Bell’s firm as its main auditor since 2006. Its contract runs through June 2011 and Mayor Ron Morrison said he has been satisfied with their work.

“I hate going for knee jerk reactions,” Morrison said. “Bell is such an anomaly. I’m not aware of any problems.”

He said Mayer Hoffman spotted a number of issues that National City’s previous auditor didn’t catch.

Councilwoman Alejandra Sotelo-Solis is not as confident.

“We definitely want to look at what’s been happening with our books and make sure that all of our i’s are dotted and t’s are crossed,” she said. “It definitely brings up concerns since we have such a tight budget.”

San Marcos officials called the firm with concerns, City Manager Paul Malone said.

“I guess they are getting a lot of calls like this,” he said. “Their senior management has asked to talk with the city. We are in the process of deciding whether we want to provide that opportunity.”

Malone said there is one more year left on San Marcos’ contract with Mayer Hoffman McCann. After officials have completed their review of Chiang’s report, they will decide how to proceed with the firm.

Calls to Escondido were not returned. City Council agendas show contracts with the firm in 2008 and 2009.

Executives from the auditing firm e-mailed a letter to all of its California clients reassuring them of the firm’s commitment along with a news release addressing Chiang’s report.

“We believe the facts demonstrate that its report mischaracterizes the nature and quality of our audit work,” Wrote Mayher Hoffman McCann president Bill Hancock. “Clearly, as a result of the SCO’s report on Mayer Hoffman McCann, there will be questions from your constituents. We stand by our work in your community, the impeccable reputation we have earned through decades of quality service to our clients, and the highest standards of auditing excellence.”

In a news release, the firm said it is willing to work with the controller to develop a new range of best practices and to revise the current standards.